If it is a passive NFFE, I do not believe it needs to be registered with the IRS by the trustees nor do the Common Reporting Standards apply.
For FATCA, my understanding is that the stockbroker/bank holding the assets for the trust has to undergo due diligence to determine if the trust, or part of it, is reportable ie has a substantial US owner-25% or more.
If there is a substantial US owner (ie the grandchild is entitled to 25% or more), then the stockbroker/bank holding the assets for the trust has to include this information in its own FATCA report to HMRC
The trust is under an obligation to update the records of the stockbroker/bank holding the assets so that they can comply with their obligations and the trust will be required to complete various US tax forms by the stockbroker/bank holding the assets.
I am not an expert, but this is my understanding of what should happen-and I am happy to be corrected!